The Nature of Conventional and Sharia Banking Operational Systems in South Sulawesi

Buyamin M Yafid 1, Syahruddin Nawi 2, Sufirman 3, Ilham Abbas 4

https://doi.org/10.62271/pjc.172.77.93

Abstract

The research aims to find out the nature of the operational system of conventional and Islamic banks. The research also aims to analyze and find the nature of the operational system of conventional and Islamic banking in South Sulawesi. This research design uses a quantitative approach, with the type of research being normative empirical. The results showed that the nature of conventional and Islamic banking operations in terms of philosophical, juridical and sociological aspects does not reflect ideal values because Islamic banks in practice are still found deviations, especially in matters related to sharia compliance. The operational system used by conventional banks is to use a credit or loan interest calculation system (invest note), the high and low interest rates in the community are influenced by various factors, namely: public liquidity, expectations, and inflation, The amount of domestic interest rates and Expectations of exchange rate changes and premiums for risk, While Sharia Banks are operationally based on the concept of Islamic Muamalah in accordance with the lines that have been determined in the Al-Qur’an and As-Sunnah, banks that operate in accordance with Islamic sharia principles. Some of the obstacles and problems faced in the development of Islamic Banks in South Sulawesi can be overcome by the role of educational institutions which in this case do play a role as human resource creators, the development of Islamic bank office networks is also needed to expand the reach of services to the community.

Keywords: Operational System, Conventional Bank, Islamic Bank, Interest System, and Profit-Sharing System.